Esprit's shares fall 6.6 percent after second-half profit warning

May 07, 2013|Reuters

HONG KONG (Reuters) - Shares in clothing retailer Esprit Holdings Ltd <0330.HK> were set to open down 6.6 percent on Wednesday after it warned of a substantial second-half loss due to soaring costs related to store closures and acquisitions in China.

The Europe-focused clothing and accessories retailer said after the market closed on Tuesday that it would record a goodwill impairment of between HK$1.8 billion to HK$2 billion related to the acquisition of the remaining interests of associated companies in China.

The company also said it would close around 16 loss-making stores, incurring an estimated cost of HK$250 million to HK$300 million.

Shares of Esprit, which sells everything from bed sheets to jeans, were set to open down HK$0.72 at HK$10.18, lagging a 0.7 percent gain on the blue chip Hang Seng Index .